Business Notes RETAILING

How does Beverly Hills' ultra-luxe Rodeo Drive get ready for an expected retail slump? By expanding, of course. So it was that klieg lights flashed and 50 fashion models strutted their stuff last week to launch a 23-store mall that cost $170 million to build on the famed shopping street. Known as Two Rodeo, the two-block project, which is designed to look as if it had been in place for a century, features an Italianate cobblestone lane called Via Rodeo that comes complete with a piazza, sculpted travertine fountains and a staircase patterned after the Spanish Steps in Rome.

Two Rodeo is the brainchild of San Francisco developer Douglas Stitzel, a onetime University of California, Berkeley, Sanskrit scholar turned businessman, who is charging his tony tenants top dollar for their new space. Tiffany, Cartier, Sulka, Valentino and other luxury outlets that plan to arrive by November will pay as much as $250,000 a month rent.

At those prices, the upscale shops must hope to avoid a slump in Christmas sales that some experts say could reduce business up to 4%. But that prospect has not daunted two Japanese investment firms that in June agreed to acquire a majority stake in the project for more than $200 million.